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Petroleum value chain
Petroleum value chain
DEPARTMENT OF ENERGY
Petroleum value chain
Mashudu Sinthumule
Petroleum value chain
Content
• Introduction
• Petroleum value chain
• Industry overview
• Frequently asked questions (Conclusion)
Petroleum value chain
Introduction
The petroleum industry is divided into three major components: Upstream, midstream and downstream.
• Upstream activities refer to the exploration and production of crude oil.
• Midstream activities refer to the refining, transportation (by pipelines, rail, tankers), storage and wholesale marketing of crude or refined petroleum products.
• Downstream activities refer to the transportation and marketing of end-user products, e.g. petrol, diesel, and liquefied petroleum gas (LPG).
Introduction
Petroleum value chain5
Industry overview
• South Africa consumed approximately 11.1-billion litres of
petrol and 12.1-billion litres of diesel during 2017.
• In 2016, the figure was approximately11,5 billion litres in
petrol consumption and 12,1 billion litres in diesel
consumption.
• Government regulates wholesale margins and controls the
retail price of petrol, illuminating paraffin and liquefied
petroleum gas (LPG).
• The petrol price in South Africa is linked to the price of petrol
in certain international petrol markets. This means that the
domestic price is influenced by supply and demand for
petroleum products in international markets, combined with
the rand/dollar exchange rate. .
Industry overview
Industry over view
Map7
INDUSTRY OVERVIEW
Refineries Capacity
Source: Sapia
Industry overview
Map
Source: Sapia
Industry overview
• Refining
• South Africa has very limited oil reserves and about 95% of its
crude oil requirements are met by imports from the Middle and
West Africa; major suppliers include Saudi Arabia (38%),
Nigeria (31%), Angola (12%) and the rest from other countries.
• Distribution
• Petroleum products are moved from refineries by pipelines,
rail, sea and road to approximately 200 depots, 4 600 service
stations and 100 000 direct consumers who are mostly
farmers. Gauteng consumes the largest amount of petrol and
diesel in the country.
Industry overview
Industry overview
Wholesaling
• BP Southern Africa, Chevron South Africa, Engen Petroleum,
PetroSA, Sasol Oil, Shell South Africa and Total South Africa
are the main players in the South African oil industry. They
operate storage terminals and distribution facilities throughout
the country.
• Until recently, there were very few non-refining wholesalers
supplying petrol and diesel in South Africa. Today, there are a
number that are registered with the Department of Energy.
Petroleum value chain
Industry overview
Retailing
•There are approximately 4 600 service stations (forecourts,
company owned and dealer owned) in South Africa. The
petroleum industry was licensed for the first time in 2005, in
terms of the Petroleum Products Amendment Act, No.58 of 2003.
•SAPIA members do have the option to franchise a service
station to an independent dealer and directly supply it with
petroleum products.
• There are also service stations that are independently operated
and unbranded.Petroleum value chain
Factors which contribute to fuel price increases
International crude oil prices
International product supply/demand balances
Product inventory levels
Geo-politics
Rand/US Dollar exchange rate
International refining margins
Weather patterns in the Northern Hemisphere
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The petroleum industry & careers
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Careers n the petroleum sector
1. Boiler making: Assemble, install and repair boilers, closed vets, vessels or containers that hold liquids and gases
Subjects: Mathematics, Science, and Language
2. Instrumentation: Use of measuring instruments to monitor and control a process
Subjects: Mathematics, Science, and Language
3. Welding: A fabrication process that joins material usually met
Subjects: Mathematics, Science, and Language
4. Safety Managers: Paramedics, nurses, health and safety inspectors, emergency response planners, industrial safety officers, and safety technicians all fall under this group but perform varying roles within the industry.
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Conclusion
1. Why are the fuel prices changing every month?
2. What is over (under) recovery?
3. Why is petrol cheaper in neighboring countries and yet they purchase it from RSA?
4. Why is SASOL not selling petrol at lower prices because they produce it from coal and they are placed in GP?
5. Why is the government not deregulating fuel prices?
6. Why is ULP95 more expensive than ULP93 in GP, but the cost the same price in coastal areas?
7. Why is the government not buying oil from African countries at a lower prices
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Contact details17
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